U.S. Probes Cable Pricing Ahead of Switch to Digital

The U.S. Federal Communications Commission said it sent letters to 12 companies after receiving complaints that some are ratcheting up prices for programing packages or requiring customers to buy digital set-top boxes for fewer channels, ahead of the change to digital-only signals.

The U.S. Federal Communications Commission said on Wednesday it sent
letters to 12 companies after receiving complaints that some are
ratcheting up prices for programing packages or requiring customers to
buy digital set-top boxes for fewer channels, ahead of the change.

Television broadcast signals will switch to digital from analog on
February 17 under a congressionally-mandated order to free up airwaves
for emergency and other uses.

FCC Chairman Kevin Martin and consumer groups have long complained
about rising cable prices, especially when rates for other
technologies, such as cellphones, have fallen.

Now, critics say cable companies may be using the digital switch as an excuse to reset rates for packages.

"We are asking why some companies have taken steps to require
customers to pay higher cable prices after the digital switch for the
same channels that they received through analog signals previously,"
Martin told reporters on Tuesday on the sidelines of an FCC meeting on
unrelated matters.

Prices for cable television nearly doubled in the decade ended in 2005, according to the FCC.

An industry spokesman said cable companies are moving their options
to digital as part of the transition, which necessitates different
channels and packages, and requires a set-top box.

Brian Dietz, a spokesman for the National Cable and Telecommunications Association, called the FCC inquiries "perplexing."

"The Bureau's actions are clearly contrary to the FCC's own policies encouraging the roll-out of new digital services," he said.

Specifically, the FCC is questioning whether companies are moving
certain analog channels to digital only, putting them out of reach of
customers who do not obtain a company-supplied set top box.

Last month, Consumers Union wrote to lawmakers questioning whether
Comcast Corp and other cable companies were fueling growth by "reaching
into the pockets of their subscribers."